BIDU tanks, losing $6.71 (-6.1%) within a single day
Baidu Inc. (BIDU) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
BIDU ended the week 3.46% higher at 103.32 after tanking $6.71 (-6.1%) today, significantly underperforming the Nasdaq 100 (0.38%) ahead of tomorrow's Memorial Day market holiday. This is the biggest single-day loss in over two months. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (BIDU as at May 22, 2020):
Friday's trading range has been $5.07 (4.77%), that's slightly above the last trading month's daily average range of $4.20. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for BIDU.
Two candlestick patterns are matching today's price action, the Bullish Hikkake Pattern which is known as bullish pattern and one bearish pattern, the Black Candle.
Prices are trading close to the key technical support level at 99.21 (S1). Prices broke below the key technical support level at 105.61 (now R1), which is likely to act as resistance going forward. The last time this happened on April 28th, BIDU actually gained 2.62% on the following trading day.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and could now be heading back down towards the mean of the Bollinger Bands at 100.37.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Price broke through Technical Support S1" stand out. Its common bearish interpretation has been confirmed for Baidu. Out of 208 times, BIDU closed lower 54.33% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after two trading days, showing a win rate of 54.81% with an average market move of -0.21%.